HCA Healthcare officials had mostly good news to share during Wednesday's second-quarter earnings call.
Officials for the Nashville-based health system giant were able to point to plenty of positive signs including a 7.4% growth in revenues, net income of $820 million for the quarter and both increasing admissions and surgeries across its facilities.
But one figure that stuck out for HCA—the largest health system in the country—was its emergency department figures. While all other numbers seemed to rise over the same quarter last year, same-facility emergency room visits for the second quarter declined about 1% from the prior year.
"When you look across the different components, we have pretty much every service line indicator show positive growth except for emergency room visits," said Sam Hazen, HCA's president and chief operating officer. "That was down in the categories of our business that are the least profitable, our low acuity business and our Medicaid business so it didn't have an effect really on our revenue stream nor our profitability."
Indeed, HCA's share price jumped Wednesday following the release of its earnings, up about 10% from the previous day's close of $108.16 to trade at $118.37 around 1:15 p.m.
HCA reported $820 million in net income attributable to HCA, or $2.31 per diluted share, for the quarter, up from $657 million, or $1.75 per diluted share in the second quarter of 2017. That was on revenues of $11.5 billion in the second quarter, up 7.4% on revenues of $10.7 billion in the same quarter 2017.
The strong performance led to HCA officials revising 2018 guidance ranges for the year up to projected revenues of $45.5 billion to $46.5 billion in 2018.
The company reported $1.6 billion in cash flow from operations and said same-facility equivalent admissions increased 2.8% and same-facility revenue per equivalent admission increased 3.6%.
Still, the emergency room drop is a notable outlier for the healthcare giant, which has more than 179 hospitals and sees 3.3 million patient admissions annually. That's particularly so as federal agencies continue to report all-time high emergency department utilization across age groups and payers.
"There are more competitors where it's in the same type of care in emergency room business or its substitutes, potentially, in urgent care. Some of our investments are potentially cannibalizing some of our business," Hazen explained.
Medicaid visits, which make up about 30% of HCA's total visits, fell by 4.8%, he said. If that payer class were eliminated, the numbers would have been up, he said. Finally, inpatient admissions through the ER for the quarter were up reflecting higher acuity patients.
"Obviously from a capital standpoint, if we lose the lower acuity, it could reduce the need for certain capital commitments down the road," Hazen said. "We continue to be very focused on our emergency rooms. Our emergency room satisfaction has grown and improved significantly over the past few years, our throughput is remarkable. We see 9 million ER patients a year. The average time for patients coming in to see a clinician is 11 minutes. So our continued focus is on operational throughput, patient satisfaction, and in some instances growth will continue to be a very important part of our story."
HCA is also planning to add to its roughly 5,000 ER beds, he said.
"We have quite a bit of utilization," Hazen said. "And as we see the marketplace evolve, we'll make some minor adjustments here and there. But we're very focused on having a very good emergency service line."